Patrick McKenzie on Salary Negotiation

Summaries of experts#

There are three people who dominate the discussion on Developer Salary Negotiation right now: Patrick McKenzie, Haseeb Qureshi (especially for early careers), and Josh Doody. Throughout the next few lessons, I cover their main talking points, occasionally adding commentary.

It is not an even playing field#

Your client/company/recruiter has far more information than you do, and they feel very differently about negotiation than you do. It is NOT an even playing field. They know what every employee makes. They know what everyone at peer companies makes, especially those they have to make counter offers for. They know how much budget they have. They have negotiated more times than you have, by multiple orders of magnitude. They may think less of you if you don’t negotiate.

Everyone in this discussion is a businessperson.#

You will not be blackballed for negotiating. Remember, it’s usually not their money. They have a budget, and a concession from them means a lot more to you than it does to them.

Negotiation starts before applying#

Your negotiation started before you applied. If you apply through regular channels, you get priced as a commodity. If hiring managers seek you out for your expertise, you have a much stronger position. Conversations like these end with resumes as a formality instead of beginning with them as a way to get interested.

Agreement in principle#

Only negotiate salary after you have an agreement in principle from someone with hiring authority that, if a mutually acceptable compensation can be agreed upon, you will be hired. “Yes, if we agree on terms,” not "No - but we might hire you if you’re cheap.” This ensures they have invested sufficient time to hire you and increases their stakes. It also ensures that, at worst, the offer you arrive at is the one they initially give.

Never give a number first#

This “rule” is almost always the right move. Many recruiters will try all sorts of tricks to get you to disclose your prior salary (it is illegal to require this) or discuss your salary expectations. This puts an immediate upper limit on what they will offer you. Patrick suggests some talk scripts to help avoid giving a number, including what to say if you have exhausted every option, and they insist on wanting a number from you. (A talk script is a pre-planned list of responses to various scenarios, often used by salespeople to guide customers down a favorable path; (see example).

Listen to what people tell you#

Listen to what people tell you and repeat it back to them. People are most persuaded by their own words and behaviors. This is related to the idea of mirroring in negotiations. Make a note of everything that matters to them that helps you make your case. Look for mutually beneficial movements, what “We” and “You” need, instead of what “I” need. Phrase things positively rather than score debating points.

Research the company#

Speak with ex-employees, customers, and current employees. Look for what they value, what success looks like internally, what the culture is like, and what is easier for them to budge on.

New information is valuable#

Offering new information on your skillset, life story, and potential value-creation helps them justify your negotiation to their bosses. For example, “I increased sales by 3% at $PREVIOUS_COMPANY. That is worth millions to you. Getting me that extra $5k would make this a much easier decision.”

Non-cash dimensions#

Cash is only one part of total compensation, and total comp is only one part of the whole job. Salaries are often constrained by salary bands, and it can be easier to offer RSUs/options. The higher up you go in level, the more stock dominates your compensation. See The Open Guide to Equity Compensation for more information. You can also find more room on signing bonuses, vacations, work-from-home benefits, travel opportunities, titles, and project assignments.

Summaries of experts#